Citi cuts Hormel Foods price target to $35, maintains Buy rating

On Thursday, Citi analyst Thomas Palmer adjusted the price target for Hormel Foods stock (NYSE:HRL) to $35 from the previous $37 while keeping a Buy rating on the company’s shares. Currently trading at $28.53, the stock sits within the broader analyst target range of $27-$37. The revision comes ahead of the company’s scheduled earnings report for the first fiscal quarter of 2025, set to be released on February 27, 2025.

Palmer projects Hormel will post earnings per share (EPS) that is one cent lower than the consensus gathered by Visible Alpha. According to InvestingPro data, two analysts have recently revised their earnings downward for the upcoming period, while the stock trades at a relatively high P/E ratio of 19.6x. This estimation is attributed to factors below the line, which had provided unusually favorable results in the previous year. Despite the price target reduction, Palmer anticipates Hormel Foods may reiterate its annual guidance, with the possibility of future upside, particularly if turkey prices rise in response to a tighter supply environment.

The analyst suggests that while the approach to the upcoming earnings report may seem uneventful, Hormel’s stock historically exhibits volatility in conjunction with earnings announcements. Hormel Foods’ performance and the market’s reaction to its fiscal results will be closely watched, especially considering the potential for changes in commodity prices to impact the company’s outlook.

Investors and analysts alike will be looking to the February 27 earnings report for indications of Hormel’s financial health and its capacity to navigate the challenges and opportunities within the food industry. The company’s impressive 32-year track record of consecutive dividend increases demonstrates its financial stability. The company’s ability to meet or exceed expectations, coupled with its guidance for the coming year, will likely influence investor sentiment and the stock’s movement in the market. For deeper insights into Hormel’s financial health and more exclusive tips, check out the comprehensive research report available on InvestingPro.

In other recent news, Hormel Foods Corporation has announced executive changes within its sales divisions. Lynn Egner has been named vice president of Foodservice sales, and Natosha Walsh will take on the role of vice president of Retail sales for the Western U.S. region. These recent developments follow the company’s annual stockholders meeting, where shareholders approved the board, auditor, and executive pay.

CFRA has downgraded Hormel Foods’ stock rating to ’Sell’ and adjusted its price target to $26.00, citing concerns over the turkey and pork commodity markets and issues with the Planters brand. Piper Sandler, however, has maintained a ’Neutral’ stance on Hormel Foods, focusing on the company’s T&M savings initiatives.

Finally, Citi has kept its ’Buy’ rating and increased the share price target for Hormel Foods to $37.00, following the company’s recent earnings and fiscal year 2025 guidance. Hormel’s performance and strategic measures are under close observation as the company navigates various industry challenges and investments.

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